Roger H. Stamper has some clear rules for picking stocks: No hot-stock tips, no fortune-cookie stuff just plain and simple. He looks for companies that consistently turn a profit. Then we load up on their stock, he explained in a telephone interview. The approach has paid off in spades for the Parkstone Small Cap Fund, which Mr. Stamper manages for First of America Bank Corp. For the five years ended Sept. 30, the portfolio produced an average annual return of 28.56%.
Mr. Stamper, 37, has been at the helm of the Parkstone Small Cap Fund since it was launched in 1988 with little more than $25 million of converted trust assets. Today it has more than $500 million under management. It is one of 15 funds in First of America's $5.4 billion-asset Parkstone Funds family, distributed by Bisys Group, Columbus, Ohio.
Mr. Stamper is part of the Growth Shop at First of America Investment Corp., the banking company's mutual fund subsidiary. The shop is a team of three managers and four researchers who share investment duties for a trio of funds.
Mr. Stamper looks for small companies that have had strong, sustainable earnings and revenues. Right now, Credit Acceptance Corp., a company that specializes in car loans to people with poor credit histories, is the fund's top holding.
He also likes Hollywood Entertainment, a video-rental company; MicroWarehouse, a shop-by-mail computer software seller; OmniCare Corp., a pharmaceutical supplier for large medical institutions such as nursing homes; and McAfee Associates, a leading provider of computer virus- protection software.
McAfee sells antibiotics for your computers, Mr. Stamper said. They distribute through the Internet, so their costs are very low and the company has grown about 40% in the last year.
Mr. Stamper, a graduate of nearby Western Michigan University, left his sleepy midwestern roots behind when he accepted a job at City National Bank, Miami.
Years later, he was approached by a recruiter who asked him if he would be interested in becoming a trust portfolio manager for a bank. The recruiter thought I wouldn't be interested because it was out in the middle of nowhere in Kalamazoo, Mr. Stamper said. What she didn't know was that I had been wanting to move back there for a while.
Mr. Stamper's connection to the bank doesn't stop there. His mother had worked for First of America for more than 20 years starting as a teller and later a mortgage officer years before he joined the mutual fund unit. People still come up to me and say, 'Yeah, I knew your mom,' he said.